The Hong Kong Securities and Futures Commission (SFC) has issued a solid warning to unregistered crypto exchange JPEX that it may face criminal charges for actively promoting its services to the Hong Kong public through influencers and over-the-counter virtual asset money changers.
The SFC also expressed concerns about JPEX's savings product, which offers a 21% annual percentage yield for ETH, 20% for BTC, and 19% for USDT, deeming it a high-risk investment.
In its caution issued to JPEX, the SFC of Hong Kong emphasized that no entity within the JPEX group holds a license from the SFC or has applied for one to operate a Virtual Asset Trading Platform (VATP) in Hong Kong.
The SFC raised several red flags about JPEX's practices and its promotion to the Hong Kong public, including false claims of being a licensed platform for digital asset trading, offering exceptionally high returns on certain products, reports of retail investors facing difficulties in withdrawing virtual assets, and the offering of products that potentially contradict the SFC's regulatory framework for VATPs.
The SFC warns against misleading statements regarding business collaborations and investment partnerships, especially with a Hong Kong-listed company.
They also note Key Opinion Leaders (KOLs) and Over-the-Counter Virtual Asset Money Changers (OTC Shops) falsely claiming JPEX's license status on social media.
Fraudulent misrepresentations can lead to fines up to $1,000,000 and seven years in prison on indictment, or fines at level 6 and six months imprisonment on summary conviction. These strict measures emphasize the gravity of deceptive practices in the virtual asset industry.
The SFC has reached out to these influencers and OTC Shops, expressing their
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